Correlation Between Loomis Sayles and Inverse Government
Can any of the company-specific risk be diversified away by investing in both Loomis Sayles and Inverse Government at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Loomis Sayles and Inverse Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Loomis Sayles Global and Inverse Government Long, you can compare the effects of market volatilities on Loomis Sayles and Inverse Government and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Loomis Sayles with a short position of Inverse Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loomis Sayles and Inverse Government.
Diversification Opportunities for Loomis Sayles and Inverse Government
-0.96 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Loomis and Inverse is -0.96. Overlapping area represents the amount of risk that can be diversified away by holding Loomis Sayles Global and Inverse Government Long in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inverse Government Long and Loomis Sayles is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Loomis Sayles Global are associated (or correlated) with Inverse Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inverse Government Long has no effect on the direction of Loomis Sayles i.e., Loomis Sayles and Inverse Government go up and down completely randomly.
Pair Corralation between Loomis Sayles and Inverse Government
Assuming the 90 days horizon Loomis Sayles is expected to generate 2.54 times less return on investment than Inverse Government. But when comparing it to its historical volatility, Loomis Sayles Global is 2.3 times less risky than Inverse Government. It trades about 0.03 of its potential returns per unit of risk. Inverse Government Long is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 19,524 in Inverse Government Long on August 26, 2024 and sell it today you would earn a total of 1,140 from holding Inverse Government Long or generate 5.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Loomis Sayles Global vs. Inverse Government Long
Performance |
| Timeline |
| Loomis Sayles Global |
| Inverse Government Long |
Loomis Sayles and Inverse Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loomis Sayles and Inverse Government
The main advantage of trading using opposite Loomis Sayles and Inverse Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loomis Sayles position performs unexpectedly, Inverse Government can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Inverse Government will offset losses from the drop in Inverse Government's long position.| Loomis Sayles vs. Loomis Sayles Bond | Loomis Sayles vs. T Rowe Price | Loomis Sayles vs. Westcore Plus Bond | Loomis Sayles vs. Aberdeen Global High |
| Inverse Government vs. Versatile Bond Portfolio | Inverse Government vs. Rbc Bluebay Global | Inverse Government vs. T Rowe Price | Inverse Government vs. Victory High Income |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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